Question

Mr. Robert is one of a member of partnership firm who was promoted to Sales manager post. His company makes low priced ready-made garments based on the order from the other companies. The firm needed $25,000 to pay for the daily wages of the workers and the suppliers who demand cash for the supplies. But his company would receive the cash from the customers only after two months of credit period, which was matter of concern. Initially, everything was fine but there was a time when the market conditions were down and the orders were few which put lot of difficulties Mr. Robert to manage the cash flow of the firm.

One of a firm assured to give order for 50000 T-shirts if the price would match their requirements. Mr. Robert was confident that he would win this order which would solve the problems of the firm which was running on low cash balance. Mr. Robert prepared a good price quotation and sent it to the client.

Mr. Robert received a call from the manager of the client company and asked for 5% of commission to finalize the order which shocked Mr. Robert. Mr. Robert discussed the issue with other partners and it was discussed that this type of issues are common in their business because if they don’t pay then other competitors would pay the bribe and win the contract. Hence, such bribing is considered as part of the contract approval. Mr. Robert was not convinced to give bribe as this would create a bad name for the company in the long run.

Questions:

1. Give your opinion in detail, about the practice of paying commission/bribe to win the Contract? (3.5 marks)

2. If you decide not to pay the bribe, then how would you convince the other partners?

3. As a manager what are other options to keep the company running efficiently with orders from customers without encouraging bribe? (3.5

Answer 1

ANS

Giving the commission or bribe unethically to win the contract is not at all a moral gesture to perform and as today the media is so active that it unfolds each and every undue situation in the market and economy ,so there are many chances that it would create a situation in which this bribery woulld be open in fron of the public and the reputation of the company would go down and therefore it wil hinder the long term reputation of the company . Also it is against the values and ethics of the person to do such an illegal task.

ANS

Convincing other partners for not to pay the bribe will not be an easy task .It would take steps like to make the partners understand the dire consequences of the bribing to get the order.The other steps includes to remind them the morals ,ethics and values of the company as in long run only these things could help the firm to stand in the market and all the unethical practices are bound to have a comeback if not today then tommorow.

ANS

The other options to keep the company running efficiently with orders from customers without encouraging bribe are that the company should improve the quality of the products ,so that it could stand above all other competitors in the market also the price should be according to the market situations because a high pricing strategy hinders a firm from getting the orders in bulk. It should involve more investment in technology of production because new and advanced technology helps a firm to yield better and efficient output.